Fairer Centrelink debt collection practices recommended

Fairer debt collection practices recommended by a Senate Committee Inquiry into the “Better Management of the Social Welfare System Initiative” recognise that Centrelink should be required to comply with the same requirements as other debt collectors.

Consumer Action Law Centre welcomes the recommendations from the inquiry report, including that:

Centrelink and its debt collectors be specifically required to comply with the debt collection guidelines issued by the Australian Competition & Consumer Commission;

Debt collection should be suspended when the accuracy of a debt is disputed; and

Centrelink payments that are recognised minimum requirements for food, shelter and other life essentials should be protected from debt collection.

“Debt repayment should not impact any individual’s ability to access life essentials”, said Consumer Action CEO Gerard Brody.

“Victorian law and court rules have long recognised that debtors should not be required to pay back debt when doing so puts their own health and wellbeing at risk. However, government bodies such as Centrelink aren’t specifically required to comply with these laws”.

“The committee’s recommendations should be adopted as soon as possible—we should expect our Federal Government to have debt collection practices that exceed the private sector”, said Mr Brody.